Arbitration

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Member states of the World Trade Organisation (WTO) – EU, Australia, Canada, China, Iceland, India, Korea, Mexico, New Zealand, Norway, Singapore, and Switzerland - published a proposal for specific changes to address the deadlock in the WTO Appellate Body. The proposal includes an increase to 9 full time working Appellate Body Members, with the term increased to 8 years, and new rules for outgoing members in order to increase efficiency and independence. In addition, the proposal sets measures to ensure that the appeal proceedings are concluded within 90 days (as set by WTO rules), explicitly excludes domestic legal issues from the subject matter jurisdiction, and mandates the Appellate Body to address only the issues necessary to resolve the dispute. The proposal foresees annual meetings between the WTO members and the Appellate Body in order to address trends in jurisprudence and any systemic issues. The proposal will be presented at the meeting of the WTO General Council on 12 December 2018.

The United States, Canada, and Mexico have reached an agreement - the USMCA (the United States-Mexico-Canada Agreement) - to replace NAFTA (the North American Free Trade Agreement). Once in force, the USMCA will significantly alter the investor-state dispute settlement (ISDS) that is currently included in Chapter 11 of NAFTA. Under the new rules, in the case of US-Canada relations, the parties will not have an option to start arbitration proceedings; instead, the investor will have to file a claim in the national court of the host state - the state where the investment has been made and the investors’ rights are breached. In the case of US-Mexican relations, three years after the termination of NAFTA, the USMCA makes a distinction between regular investments and those involving government contracts. Claimants with regular investments may only challenge measures in breach of regulations on national treatment, most-favored nation treatment, and expropriation, excluding indirect expropriation. Before submitting the claim to arbitration, the claimant must first file the claim with the courts of the host state. The arbitration can only commence if there is a final decision of a ‘court of last resort of the respondent or 30 months have elapsed’ from the start of the domestic court proceedings. In the case of Canada-Mexico relations, the USMCA does not regulate the arbitration proceedings. Instead, the investors will have to file claims under the dispute settlement regulations of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) expected to be ratified by Canada on 29 October. The treaty is not yet in force. See also: Canada, Mexico and the US reach a deal to revise NAFTA

A US judge in Manhattan ruled that a Uber can force a customer to settle a price-fixing complaint through arbitration, despite the customer’s view that the case should be settled in court, as he did not agree to arbitration. In the case at hand, the customer claims that Uber has conspired with drivers to change surge pricing fares during peak demand periods. He also says that he has not agreed to arbitrate because ‘a keypad had obscured a hyperlink to Uber’s terms of service, including the arbitration clause, when he signed up with his smartphone’. In response, Uber argued that the customer had an unobstructed view of the hyperlink. The lawsuit, which began in December 2015, went through several stages, including appeals by both Uber and the customer. The judge’s decision to reinstate the arbitration provisions was welcome by Uber, while the customer’s lawyers noted they are waiting for the court’s opinion before deciding about the next steps.

Mandatory arbitration clauses become more frequent in all type of contract with consumers, especially in Banking sector, which is why U.S. Consumer Financial Protection Bureau started research about its effect. After many years of examination they proposed the rule that should preclude companies of depriving consumers of right to class action by accepting arbitration clauses. Class actions are very important mechanism in consumers disputes, given the unequal position of the parties in dispute, the value of the dispute, the cost of arbitration and many other factors. This is it is important to enable consumers to join together in claims over same manner since in this manner they can initiate actions that in other case would not be feasible, if they would be up to individual consumer. This decision is still waiting for Senate to give final call.

The Arbitration and Mediation Centre of the World Intellectual Property Organisation will become an alternative dispute resolution (ADR) provider for the .eu and .ею top-level domains (TLDs), as of June 2017. As announced by EURid, the registry for the two TLDs, holders of a trademark, trade name, company name, or other rights will be able to use the services of the WIPO Arbitration and Mediation Centre to dispute potentially speculative and abusive .eu and .ею domain name registrations The Centre becomes the second ADR provider, in addition to the current Czech Arbitration Court.

The World Intellectual Property Organization (WIPO), which administers Uniform Domain Name Dispute Resolution Policy (UDRP) cases, has reported that trademark owners filed 3036 UDRP cases in 2016, an increase of 10% over the previous year. Cybersquatting disputes relating to new generic top-level domains (gTLDs) rose to 16% of WIPO’s caseload in 2016, covering a total of 5374 domain names. The gTLDs with most disputed domain names were .xyz, .top, and .club. Country code top-level domains (ccTLDs) accounted for around 14% of WIPO fillings.

Arbitration is a dispute resolution mechanism available in place of traditional courts. Such mechanisms are used extensively to fill the gap engendered by the inability of current international private law to deal with Internet cases. An example is the Universal Domain-Name Dispute-Resolution Policy (UDRP), which was developed by WIPO and implemented by ICANN as the primary dispute resolution procedure.

In arbitrations, decisions are made by one or more independent individuals chosen by the disputants. The mechanism is usually set out in a private contract, which also specifies issues as place of arbitration, procedures, and choice of law. International arbitration within the business sector has a long-standing tradition.

In comparison to traditional courts, arbitration offers many advantages, including higher flexibility, lower expenses, speed, choice of jurisdiction, and the easier enforcement of foreign arbitration awards. One of the main advantages of arbitration is that it overcomes the potential conflict of jurisdiction. Arbitration has particular advantages in regard to one of the most difficult tasks in Internet-related court cases, enforcement of decisions (awards). The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards regulates the enforcement of arbitration awards. According to this convention, national courts are obliged to enforce arbitration awards. Paradoxically, it is often easier to enforce arbitration awards in foreign countries by using the New York Convention regime rather than to enforce foreign court judgement.

The main limitation of arbitration is that it cannot address issues of higher public interest such as protection of human rights; these require the intervention of state-established courts. Arbitration has been used extensively in commercial disputes. There is a well-developed system of rules and institutions dealing with commercial disputes.

The main international instrument is the United Nations Commission on International Trade Law (UNCITRAL) 1985 Model Law on International Commercial Arbitration. The leading international arbitrations are usually attached to chambers of commerce.

Arbitration and the Internet

Arbitration and other alternative dispute resolution systems are used extensively to fill the gap engendered by the inability of current international private law to deal with Internet cases. For example, the Universal Domain-Name Dispute-Resolution Policy (UDRP) was developed by WIPO and implemented by ICANN as the primary dispute resolution procedure. Since the beginning of its work under UDRP in December 1999, the WIPO Arbitration and Mediation Center has administered more than 22,500 cases and with the introduction of new gTLDs, new challenges are expected to occur.

The UDRP is stipulated in advance as a dispute resolution mechanism in all contracts involving the registration of gTLDs (e.g. .com, .edu, .org, .net) and for some ccTLDs as well. Its unique aspect is that arbitration awards are applied directly through changes in the DNS without resorting to enforcement through national courts.

Arbitration provides a faster, simpler, and cheaper way of settling disputes. However, the use of arbitration as the main Internet dispute settlement mechanism has a few serious limitations.

First, since arbitration is usually established by prior agreement, it does not cover a wide area of issues when no agreement between parties has been set in advance (libel, various types of responsibilities, cybercrime).

Second, many view the current practice of attaching an arbitration clause to regular contracts disadvantageous for the weaker side in the contract (usually an Internet user or an e-commerce customer).

Third, some are concerned that arbitration extends precedent-based law (US/UK legal system) globally and gradually suppresses other national legal systems. In the case of e-commerce, this might prove to be more acceptable, given the already high level of unification of substantive rules of commercial law. However, an extension of precedent law has become more delicate in sociocultural issues such as Internet content, where a national legal system reflects specific cultural context.

ICC engages in the WTO particularly representing micro, small, and medium enterprises (MSMEs). In 2016 ICC issued a report calling for a new WTO agreement on e-commerce. ICCâs objective is to have an e-commerce framework that is more open to MSMEs. The report recommends three main actions: a capacity building fund for SMEs; making trade more efficient for SME for instance through harmonised tariffs for low value items; and global rules to support consumer trust in the digital economy. ICC has also carried out research on trans-border data flows.

The WTOâs involvement in e-commerce-related issues started in 1998, when the Ministerial Conference adopted th

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The WTOâs involvement in e-commerce-related issues started in 1998, when the Ministerial Conference adopted the Declaration on Global Electronic Commerce, which called for the development of a work programme on e-commerce. The programme, also adopted in 1998, provides a definition for e-commerce and sets out responsibilities for WTO bodies in e-commerce-related areas. Other e-commerce-related initiatives undertaken by the WTO include: a moratorium rendering electronic transmissions free of custom duties among WTO member states; a dispute resolution mechanism which addresses, among others, cases involving electronic transactions; and the annual WTO Public Forum. There are ongoing discussions among WTO member states as to whether the organisation should play an increasing role in eâcommerce.

ICANN is responsible for coordinating the evolution and operation of the Domain Name System.

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ICANN is responsible for coordinating the evolution and operation of the Domain Name System. The organisation coordinates the allocation and assignment of names in the root zone of the DNS, and the development and implementation of policies concerning the registration of second-level domain names in generic top-level domains (gTLDs). It also facilitates the coordination and evolution of the DNS root name server system. When it comes to gTLDs, ICANN concludes agreements with registry operators (for the administration of each gTLD), and accredits registrars. In the case of country code top-level domains (ccTLDs), ICANN only goes as far as (re)delegating them on the basis of some high-level guidelines.

Over-the-top services, next generation networks, the collaborative economy, and artificial intelligence are am

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Over-the-top services, next generation networks, the collaborative economy, and artificial intelligence are among the issues the European Commission is paying particular attention to. The Electronic Communications Code proposed by the Commission in September 2016 plans to introduce some level of regulation for OTT services. Encouraging the deployment of NGN networks able to better support the provision of converged services is a priority for the Commission, as part of its Broadband Strategy and Policy. The EU executive body has also issued guidelines and policy recommendations for the collaborative economy, while its Digitising European Industry strategy identified artificial intelligence and robotics are cornerstone technologies to be supported.

Instruments

Conventions

Cybercrime, referred to broadly as crime committed via the Internet and computer systems, is a phenomenon that continues to affect individuals and entities worldwide, and to pose increasing challenges to law enforcement authorities. One of these challenges is related to the transborder nature of cybercrime, which has implications for the efficiency and effectiveness of any measures aimed at combating this phenomenon.

The Convention on Cybercrime (also known as the Budapest Convention), adopted in 2001 within the framework of the Council of Europe, aims to respond to this challenge by setting a minimum common ground for national legislations on cybercrime, as well as a framework for international cooperation among countries. The Convention, initially signed by 31 countries, is currently ratified by 48 countries (40 members states of the Council of Europe, plus Australia, Canada, Dominican Republic, Japan, Mauritius, Panama, Sri Lanka and the United States of America).

The first part of the Convention describes types of acts that countries should deem as criminal offences through national legislations; these include: offences against the confidentiality, integrity and availability of computer data and systems (such as illegal interception and data and system interference); computer-related offences (forgery and fraud); content-related offences (child pornography); and infringements of copyright and related rights. This section also includes provisions on procedural law, outlining the powers and procedures necessary for law enforcement authorities to engage in activities aimed at detecting, investigating and prosecuting cybercrime. The second part of the Convention focuses on international cooperation aspects, and outlines a series of general principles for such cooperation, as well as specific provisions on mutual assistance between countries in areas such as accessing of stored computer data, and interception, preservation, and disclosure of data. In 2003, a Protocol has been added to the Convention, on the criminalisation of acts of a racist and xenophobic nature committed through computer systems.

The Budapest Convention can be seen as the only de-facto international treaty on cybercrime (given that it has also been ratified by countries beyond Europe, and therefore does not have a regional coverage only), and it continues to be open to accession by interested countries. The Convention has been used as basis for many national legislations dealing with cybercrime-related issues, as well as for regional legal instruments in this area (such as the Cybercrime Directive of the Economic Community of West African States and the African Union Convention on Cyber Security and Personal Data Protection). However, some countries have also raised concerns over certain provisions of the Convention (especially those related to international cooperation and mutual assistance), which were seen as violating international law norms and countries' sovereignty.

The implementation of the Convention is facilitated by the Cybercrime Convention Committee, which is composed of representatives of signatory states. The Committee is also tasked with facilitated the exchange of information regarding the use of the Convention, as well as with considering future amendments that can be brought to the treaty. In June 2013, the Committee adopted a series of guidance notes representing the common understanding of parties regarding the use of the Budapest Convention on the following issues: computer systems, botnets, transborder access, identity theft, DDOS attacks, critical infrastructure attacks, malware, and spam. In addition, the Cybercrime Programme Office, opened by the Council of Europe in 2014, supports countries in building and strengthening their capacities to respond to cybercrime challenges, on the basis of the Budapest Convention.

Adopted by Council of the Common Market for Eastern and Southern Africa in 2010, the model law contains provisions on: electronic signatures, e-commerce, consumer protection, unsolicited commercial commynications, and online dispute resolution. The model law is accompanied by a guide to enactment, meant to assist member states in deciding which of the model law's provisions could/should be transposed into national legislation.

Resources

Publications

The latest edition of glossary, compiled by DiploFoundation, contains explanations of over 130 acronyms, initialisms, and abbreviations used in IG parlance. In addition to the complete term, most entries include a concise explanation and a link for further information.

The book, now in its sixth edition, provides a comprehensive overview of the main issues and actors in the field of Internet governance and digital policy through a practical framework for analysis, discussion, and resolution of significant issues. It has been translated into many languages.

GIP event reports

The session discussed the role of courts, public and private, in Internet governance (IG). The moderator, Dr Jovan Kurbalija, Director, DiploFoundation, introduced key trends which framed the debate: the increasing participation of courts in IG, growing challenges to the protection of citizens’ online rights, and the fact that we are at the brink of another information revolution, with artificial intelligence (AI) at the forefront. Welcoming remarks were made by Mr Michael Kleiner, Economic development officer, State of Geneva Directorate General for Economic Development, Research and Innovation (DG DERI), who provided a framework for the discussion as part of the Geneva Digital Talks, a process drawing on practical solutions and cyber expertise in Geneva. The Geneva Digital Talks will be concluded at the Internet Governance Forum in December and will hopefully continue in 2018.

The speakers set out the scene for the discussion: Dr Roxana Radu, Manager, Geneva Internet Platform (GIP), analysed the past regulation of traditional IG matters, contrasting them with present technological issues and emerging dilemmas. Mr Vincent Subilia, President, Swiss Chambers' Arbitration Institution (SCAI), provided a link between digital policy and the practice of arbitration in Geneva. Prof Dr Jacques de Werra, Vice-rector, University of Geneva, discussed how a system of micro-justice, based on values and standardisation, could assist in settling private Internet-related disputes that may arise between Internet platforms and their users.

Radu began by offering an overview of legal issues in Internet governance debates. Dividing her presentation into two parts, she first analysed the evolution of regulation in traditional IG matters, as well as the preferred legal instruments on a hard-soft law continuum. While in the late 1980s ‘hard’ instruments were the default option for regulating the Internet, post-1995 it was primarily via ‘soft’ mechanisms, such as guiding principles, model laws and global strategies that the Internet was regulated. The latter were also used to address the two greatest issues from 2005 onward, cybersecurity and civil liberties. In the second part, Radu discussed the legal implications, present and future, of three digital trends: sharing economy, digital rights, and AI. Using the examples of Uber (taken from a DiploFoundation original study) and Google to illustrate the first two tendencies, she approached AI differently, through questions concerning accountability, ownership, citizenship, and the social and political rights of robots (including replication, voting and taxation). To conclude, Radu posited that the hybrid nature of new business models produces legal uncertainty, whereas AI and emerging technologies require ethical clarifications to begin with.

Subilia established a link between the broad topics in digital policy and the practice of arbitration. SCAI has issued more than 1000 awards since its establishment. While it does not yet provide online services, this may fit within the organisation’s plans. Subilia stated that SCAI is contemplating adding innovative tools to its process in order to continually improve quality, cost-effectiveness and speed for awards (recognised in the 149 countries that ratified the New York Convention). On the matter of speed, Subilia noted that SCAI introduced an expedited process as early as 2004, ‘time is indeed of the essence’ such as for example when it comes to the domain names dispute resolution. Lastly, Subilia mentioned the recently launched ejust service as example of online arbitration.

According to de Werra, it is not uncommon for courts to step in when regulation is not clear enough. There is therefore no reason to worry if courts sometimes engage in digital policy making by rendering decisions in Internet-related cases. However, what poses a problem is the fact that private actors (specifically Internet platforms) can (and may even have to) engage in quasi-judicial activities by rendering decisions which could have a major impact on millions of Internet users around the globe. This is precisely what has been taking place since the well-known 2014 decision by the Court of Justice of the European Union on the so-called ‘right to be forgotten’ (more precisely the right to be de-indexed). Google has since had to decide on hundreds of thousands of requests for removing content, and the persons who were not satisfied with the decisions made by Google generally did not challenge the decisions before the relevant bodies because of the costs and other burdens associated with such proceedings. In the Internet age, traditional court proceedings before national courts do not appear as the most appropriate way to decide Internet-related disputes which can arise between Internet platforms and their users. Cases like the ones pertaining to the ‘right to be forgotten’ consequently confirm the need for a system of online micro-justice, whereby a neutral, trusted private party would judge each individual case in order to address the challenges of what de Werra has called ‘Massive Online Micro Justice’ (MOMJ). Geneva and Switzerland can bring their tradition and expertise in international dispute resolution in order to formulate digital dispute resolution policy proposals that would respond to the challenges of MOMJ. This is what the University of Geneva’s digital policy project, the ‘Geneva Internet Disputes Resolution Policies 1.0’ was intended for. Such a system should reflect key values, such as transparency, expertise and efficiency, and human-based justice (and not AI-driven justice).

Kurbalija encouraged the ensuing discussion by asking the panellists and the audience whether they ever needed access to justice in online matters, personally or institutionally. The ‘right to be forgotten’ procedures, data breaches imperatives, the lengthy time of court proceedings, and the disconnect between global technologies and local jurisdiction were among the topics addressed.

The session was dedicated to the discussion of how to protect the acronyms of International Governmental Organisations (IGOs). The discussion encompassed the following topics: a) which names or acronyms should be reserved; b) how to notify IGOs of the registration of a related name; c) the dispute resolution mechanism that could be used to resolve potentially competing legal processes; d) the appeal mechanism if the parties disagree with the results of that dispute resolution.

Mr Bruce Tonkin, ICANN Board, kickstarted the discussion by revising the narrow scope of ICANN’s mandate: to ensure the security and stability of the domain name system. He also listed some of the principles that guide the organisation, such as: the need to carry out its activities in conformity with the relevant principles of international law, international conventions and applicable local laws, while recognising that governments and public authorities are responsible for public policy and taking into account public policy advice. This should be done in a way that respects the multistakeholder decision-making process, ensuring that as many parties as possible are involved in assessing the global public interest.

With regard to applicable laws, the Generic Name Supporting Organization (GNSO) policy development process (PDP) is taking into account the Paris Convention for the protection of industrial property, which has some specific provisions that relate to the names and abbreviations of intergovernmental organisations, preventing third parties from getting a trademark against these names. The Article 6ter is only applicable to trademarks and its purpose is to prohibit the registration and use of trademarks that are identical to or present certain similarity with the name or official signs of an IGO.

The current status of discussions is the following, when it comes to the reservation of names and acronyms:

Names: the ICANN Board has approved permanently withholding from registration at the second level.

Acronyms: the Board has approved interim protections for the acronyms in gTLDs. At this stage, the current prevailing view seems to be that acronyms have multiple uses, they are not owned by any one party and therefore it is not appropriate to reserve them in advance.

It is important to note, however, that both of these provisions do not protect names in gTLDs registered or top level names created prior to 2012. This means that there is no current protection for com, net, org, biz, info, name, moby, for example. One of the reasons that justify a policy development process is to make sure that the approach is applied to all gTLDs.

An additional complexity is that acronyms are not unique. For example, AU is the acronym for the African Union and that is also the country code for Australia. Many companies use AU as a designation to indicate their Australian operations.

The next topic of discussion was a mechanism that would let IGOs know when an undue registration happens. In this regard, suggestions were received from both the GNSO and the Governmental Advisory Committee (GAC). Both agree with the idea of a notification period, based on the experience of trademark protection, but the issue is how this notification should be done, to whom and for how long. The model of a 90-day 'Sunrise period’, proposed by the GNSO, was not accepted by the GAC because the opportunity for abusing a name may come at any time. For the GAC, a permanent notification mechanism should be preferable.

An adaptation of the 90-day period gained traction during the session and it was also suggested that ICANN could be a service provider for giving notification that an IGO name has gone into the DNS. This 90-day approach would allow use of the model of existing mechanisms and avoid re-opening a PDP. When it comes to potential dispute resolution mechanisms applying to IGO-related names, it was felt by some participants that it would be more pragmatic to give IGOs easier access to the existing improved system, unless there is a legal opinion that IGOs would need a separate system because of their immunity.

When it comes to appeals, the prevailing opinion seemed to be that ICANN’s curative rights processes are supplements to existing laws and that ICANN has no authority to compel registrants to submit to arbitration with no legal appeal. What would happen with regards to IGO’s immunity from national judicial process is an issue that deserves further discussion.

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